In Sandwich L/o, What Happens When T/b Does Not Buy?
In a sandwich lease option (if my terminology is correct), when you lease option from a seller and then sub lease to a t/b, what happens if the t/b does not exercise their option to purchase, doesnt that leave you with a liability to exercise your option to purchase lest you lose your investment altogether? May be making mountains out of molehills but.... eh... what do you think? 
A few options:
1. Get a longer option term when buying (example buy with 4 years, sell with 2)
2. Make sure your t/b gives you a larger option deposit than you paid and also more rent than you paid. If the option is not excersized you are still ahead some.
There may be a few more ideas. These just come to mind first.
Ramgon 1280, lets say....
In a sandwich.. you lease purchase for 3 years you sub lease for 1...you would simply sublease again....if tenant/buyer does not exercise option... you will make more $$$$.
if you lease purchase for 1 year and sub lease for 1 year , you need to exercise option of forfiet .... now your risks going into it
now if you structure your contracts properly it can be very profitable for you....
P.S. San Antonio... Ram by any chance...I was ....
Ah Yes San Antonio! Go Spurs Go! Anyways, so as a rule of thumb, whenever possible, lease from the seller at a longer term and sub-lease to t/b at shorter increments providing for instances of opting out. Ah I see.... thank you both for your wisdom. I am one step closer to gaining the confidence to approach my first deal. You guys are priceless....
You can also have language in the option agreement that the new tenant buyer must notify you 60 days prior to exercising their option.
Eric & Rosa
[addsig]
If worse comes to worse. Try renegociating your contract with the seller for a longer term. Maybe an increase in monthly payment or additional option moneys. You could also just get a mortgage on the house yourself and with the appriciation you could be getting a hell of a deal.
ex. your contract-
100,000 buy price
$1000 option fee (I would try not to give one)
$100 credit each month toward the down payment @ 3 years
you buy price is actually $96,400
7% appriciation average for 3 yearson $100,000 =
122,504.30 actual value of property in 3 years so........
You just bought a house worth 123,000 for 96,000. You just made 26,000 in equity. That should move you even closer to your first deal.
Ah yes..... Pearls of wisdom... You have outdone yourselves yet again! Thank you for your valued input!